Retail Sector

Research evidence excerpt

Retail Sector

arnings perspective, we focus on Skylark’s

Skylark 3197 N 664.8 3,000 2,922 2.7% restaurant brands Sukesan Udon and Shabu-Yo as the company plans to expand the number of stores. As these restaurant brands generate high

levels of sales per store, we think increasing the store count should boost overall sales per store.

Under President Hideharu Matsutani's leadership, improvements in menus, restaurant operations, and organizational structure have driven

improvements in domestic same-store sales and profitability. We expect sales per outlet to grow further going forward on further refinement of the

Saizeriya 7581 OW 292.2 7,300 5,590 30.6%

business model and organizational structure. As the company prepares for a full-scale growth phase, including improvements in menus as well as

store and employee productivity, we see an increasing likelihood of medium-term growth globally.

E-commerce platformer

We rate the shares Neutral as we see few positive catalysts for the time being and believe the share price is within the fair-value range. We expect

ZOZO 3092 N 1,033.4 1,050 1,159 -9.4%

strong, stable GMV growth of about 4% over the medium term as well as continued generation of free cash flow.

We see large scope to expand share in the ¥8–10 trillion indirect materials market (MonotaRO’s market share in 2025 is 3-4% ), and think

MonotaRO can leverage its broad product lineup and ease of product search to continue expanding existing customer wallet share and acquiring

MonotaRO 3064 N 949.9 1,900 1,915 -0.8% new customers over the longer term. We believe a premium is reasonable considering the sustainability of topline growth at MonotaRO over the

next three years compared to other e-commerce platforms.